The Union Cabinet has approved abolition of existing “Guidelines for establishing Joint Venture Companies by Defence Public Sector Undertakings (DPSUs)”.
The decision comes in the backdrop of the issues which emerged in the operationalisation of JV guidelines of DPSUs.
The Department of Defence Production came to the conclusion that with the increasing participation of the private industry in defence sector and the transformation taking place in the defence acquisition eco system thereon, the requirement of having separate JV guidelines for DPSUs is no longer considered necessary.
In the emerging scenario with primacy being accorded to Make in India, it is felt that having multiple set of guidelines may lead to ambiguity and incongruity in the environment.
These guidelines which were notified in February, 2012 will not be required for separate JV by the DPSUs. The Guidelines issued by the Department of Public Enterprises (DPE) and Ministry of Finance (MoF) from time to time, which are uniformly applicable to all Central Public Sector Enterprises (CPSEs) will be applicable for the DPSUs to set up JV companies now. This will meet the goal of indigenization in this sector.
The abolition of the existing JV Guidelines will provide a level playing field between DPSUs and the private sector. It will allow DPSUs to forge partnerships in an innovative manner enhancing self-reliance in defence.
All nine DPSUs i.e. Mazagon Dock Limited, Goa Shipyard Limited, Garden Reach Shipbuilders & Engineers Limited, Hindustan Shipyard Limited, Bharat Electronics Limited, Hindustan Aeronautics Limited, Bharat Earth Movers Limited, Bharat Dynamics Limited and Mishra Dhatu Nigam Limited will be benefited through this decision.
By Belal Khan
